Richard Sloan from the University of Michigan was first to document what is referred to as the "accrual anomaly". His 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones.
As of Jan. 2024, Leading Edge Materials has a Sloan Ratio of 0.26%, indicating the company is in the safe zone and there is no funny business with accruals.
Leading Edge Materials Sloan Ratio % Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Leading Edge Materials's Sloan Ratio %
For the Other Industrial Metals & Mining subindustry, Leading Edge Materials's Sloan Ratio %, along with its competitors' market caps and Sloan Ratio % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Leading Edge Materials's Sloan Ratio % Distribution in the Metals & Mining Industry
For the Metals & Mining industry and Basic Materials sector, Leading Edge Materials's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Leading Edge Materials's Sloan Ratio % falls into.
Leading Edge Materials Sloan Ratio % Calculation
Earnings contain a lot of non cash earnings which is called accruals. The Sloan ratio is a way to identify firms with low non-cash or accrual-derived earnings relative to their cash flow.
Leading Edge Materials's Sloan Ratio for the fiscal year that ended in Oct. 2023 is calculated as
Leading Edge Materials's Net Income for the trailing twelve months (TTM) ended in Jan. 2024 was -1.236 (Apr. 2023 ) + -0.322 (Jul. 2023 ) + -0.387 (Oct. 2023 ) + -0.686 (Jan. 2024 ) = C$-2.63 Mil.
Leading Edge Materials's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2024 was -0.515 (Apr. 2023 ) + -0.283 (Jul. 2023 ) + -0.449 (Oct. 2023 ) + -0.358 (Jan. 2024 ) = C$-1.61 Mil.
Leading Edge Materials's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2024 was -0.286 (Apr. 2023 ) + -0.177 (Jul. 2023 ) + -0.338 (Oct. 2023 ) + -0.293 (Jan. 2024 ) = C$-1.09 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Leading Edge Materials (TSXV:LEM) Sloan Ratio % Explanation
A former University of Michigan researcher, Richard Sloan's 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones. In fact, for the 40-year period between 1962 and 2001, buying the lowest accrual companies and shorting the highest accrual companies resulted in an average annual compounded return of 18%, more than double the S&P 500's 7.4% annual return over the same period.
If the Sloan Ratio is between -10% and 10%, the company is in the safe zone and there is no funny business with accruals.
If the Sloan Ratio is less than between -25% and -10% on the negative side, and between 10% and 25% on the positive side, this is a warning stage of accrual build up.
If the Sloan Ratio is less than -25% or greater than 25%, and this ratio is consistent over several quarters or even years, be careful. Earnings are highly likely to be made up of accruals.
As of Jan. 2024, Leading Edge Materials has a Sloan Ratio of 0.26%, indicating the company is in the safe zone and there is no funny business with accruals.
Leading Edge Materials Sloan Ratio % Related Terms
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Leading Edge Materials (TSXV:LEM) Business Description
Leading Edge Materials Corp is a Canada based exploration company. It is involved in the exploration and development of resource properties in Sweden and Finland with corporate operations in Canada. The company is focused on the supply of the materials needed for the generation, storage, and preservation of low carbon energy. The properties owned by the company are Woxna Graphite Mine located in central Sweden, and Norra Karr Mine, a rare earth element resource, located in south-central Sweden, and Bergby project.
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